Two dozen U.S. senators and representatives have signed a letter expressing concern over the Defense Health Agency’s (DHA) decision to continue to exclusively contract with Express Scripts to administer TRICARE’s pharmacy program, used by 9.6 million uniformed service members, retirees and their family members.
In a June 26 letter to DHA Assistant Secretary Dr. Lester Martinez-Lopez and DHA Director Lieutenant General Telita Crosland, Sen. Elizabeth Warren (D-Mass.) and Earl L. (Buddy) Carter (R-Ga.) wrote, “Since the DHA granted Express Scripts its exclusive TRICARE contract in 2009, the company has consistently leveraged its market power to squeeze independent pharmacies and steer TRICARE beneficiaries to their own mail-order pharmacy, and used other tactics to increase costs for service members and taxpayers.”
The letter was additionally signed by two senators and 20 representatives: Sens. Mike Rounds (R-S.D.) and Peter Welch (R-Vt.); and Reps. Katie Porter (D-Calif.), John Rose (R-Tenn.), Diana Harshbarger (R-Tenn.), Ralph Norman (R-S.C.), Jen A. Kiggans (R-Va.), Adrian Smith (R-Neb.), Claudia Tenney (D-N.Y.), Donald G. Davis (D-N.C.), Neal P. Dunn (R-Fla.), Mike Flood (R-Neb.), Madeleine Dean (D-Pa.), Abigail Davis Spanberger (D-Va.), Stephanie Bice (R-Okla.), Robert B. Aderholt (R-Ala.), Becca Balint (D-Vt.), James Comer (R-Ky.), Rick W. Allen (R-Ga.), and Mariannette Miller-Meeks (R-Iowa).
Cigna merged Express Scripts with its mail-order pharmacy
Express Scripts, which the letter noted is the second-largest pharmacy benefit manager (PBM) in the country, is owned by Cigna, which purchased the PBM in 2018. After the acquisition, Cigna combined its existing mail-order pharmacy, Accredo, with Express Scripts.
“As a PBM, Express Scripts sets reimbursement rates at pharmacies and bills insurers when its enrollees fill their prescriptions,” the letter said. “However, because Cigna also owns Accredo, it can effectively keep much of its business in house, using its PBM to steer patients to its own pharmacy while disadvantaging competitors.”
As an example, the letter said Express Scripts appears to “routinely” under-reimburse cancer clinic pharmacies for costly cancer treatment drugs. “When pharmacies reject Express Scripts’ predatory terms, patients are forced to use Accredo’s mail-order pharmacy, which is prone to delays and safety issues, but drives more profits to parent company Cigna,” the letter said.
The letter added that nearly 15,000 pharmacies left the TRICARE network in 2022 due to inadequate reimbursement, “forcing 400,000 active-duty and retired military families to decide between searching for a new in-network pharmacy or simply opting into Accredo’s mail order option.” One industry expert, the letter said, contended that the defense department “is allowing contractors to hold up pharmacies to say, ‘Either you accept a money-losing contract, or take the blame for not serving veterans.’”
While TRICARE adjusted its terms in late 2022 to win back some pharmacies, approximately 10,000 pharmacies stayed away.
“Indeed, this exodus of independent and retail pharmacies can be catastrophic for TRICARE beneficiaries, especially those with complex medical conditions who are ill served by mail-order pharmacies,” the letter said.
The representatives and senators who signed the letter asked Martinez-Lopez and Crosland a number of questions, including asking for verification that Express Scripts is following network adequacy requirements of having at least one pharmacy within 15 minutes’ driving time for 90% of TRICARE beneficiaries; asking the number of pharmacies in TRICARE’s current network; and asking how the DHA tracks denials of costly specialty drugs.
